Foreign aid is an investment in our future

Jobs and the free market are at the heart of a revolution in the way Britain
offers help

This year, Britain met its historic promise to use 0.7 per cent of our national income to support the world’s poorest people. This spending has allowed us to do some remarkable things: to give just one example, a child is vaccinated against deadly disease every two seconds thanks to Britain’s efforts, and one of their lives is saved every two minutes.

Critics of our aid programme argue either that it wastes money, or that it is an unnecessary luxury at a time of economic hardship for many families in Britain. Certainly, the real test of such spending must always be whether it delivers value to British taxpayers – not just whether the funds are used for the best possible advantage, but whether it is aid and development that works for Britain as well as coming from it.

Of course, this country has a proud history of assisting those who are suffering. Yet our international development policies are not about soft-hearted altruism. They are a clear and hard-headed means of promoting our own security and prosperity, and are a valuable investment in Britain’s future.

To start with, there is clear evidence that aid and development works. Over recent years, agreements to cancel debt and increase aid, together with economic growth across Asia, have seen more than 500 million people lift themselves out of poverty, millions more children receive an education, and child mortality rates plummet. As countries we support benefit from growth and investment, Britain will benefit too.

As a former development secretary, I wish more people could see the huge difference our policies are making. Last year, I stayed with a poor family in a village 150 miles from Addis Ababa. The parents worked hard but lived on less than 50p per day. Each night their home – which sheltered mother, father, grandmother, eight children, four sheep, two goats and a cow – filled with smoke from the open fire. Yet over the past two years, their lives had been transformed by British aid. Clean water used to be a two-hour walk away; it could now be reached in two minutes. Going to school involved a walk of just one mile.

There are many such opportunities for us to help. In South Sudan, for example, a girl is more likely to die in childbirth than to complete her primary education. Yet at the same time, the aid agenda is moving on. As essential as traditional interventions such as providing clean water and sanitation are building the rule of law, supporting openness and transparency, cracking down on corruption and tax evasion and building the sinews of a democratic state.

When the Coalition took office, Britain ended aid to China and Russia and announced that it was “walking the last mile” with India. The focus of our bilateral aid was narrowed from 43 countries to the 27 where it was most needed. And up to half our aid programme was devoted to investment that sought to generate a return for Britain.

We also decided to hold the organisations and international agencies through which some of our aid was channelled to account – in many cases, for the first time since they were founded. Our review found that some perform outstandingly well (funding for Unicef was doubled). Others were asked to make reforms, or placed in “special measures”, or had their funding withdrawn.

This is not the only way in which we have changed how aid works. The Government has ensured that what we give is branded with the Union flag, so that the contribution of the taxpayer is there for all to see. Development is now also part of a wider economic, military and diplomatic strategy: the Department for International Development is no longer seen as a rather well-upholstered NGO moored off the coast of Whitehall. Just as security is impossible without development, so development is impossible without security. An international intervention in Somalia in 2011 – led by Britain – saved hundreds of thousands of lives from famine, but subsequent nation-building efforts helped address a grave security threat (until recently, there were more British passport-holders in terrorist training camps there than in any other country).

Of course, the fastest way to alleviate poverty is to get people jobs. For Conservatives, this is part of our DNA – and even Labour increasingly recognises that the market is the engine, not the enemy, of development. One of our first actions was to set up a private-sector department within DfID, and a vigorous recruitment programme to address this deficiency in the Civil Service’s DNA.

Central to this was the radical reform of CDC, formerly the Commonwealth Development Corporation. This is the Government’s development finance institution, created to provide “pioneer capital” where the commercial sector is too nervous to tread and “patient capital” which does not require an immediate commercial return – and to return a profit to the taxpayer. CDC now has every chance of becoming the world’s leading provider of such finance – indeed, in 50 years’ time, I believe it, rather than DfID, will be the principal arm of British development policy. Nothing would more eloquently demonstrate the success of our strategy, as countries graduate from aid to using their own markets to fund development.

In recent years, the old certainties of the Left – that aid is all about spending taxpayers’ money – or the Right – that all the money ends up in Swiss bank accounts – have made way for a new agenda. By focusing on a development strategy that is both moral and pragmatic, rooted in a sense of compassion but an appreciation of the power of the free market, we can deliver a better life for millions of people – and a safer and more prosperous world for Britain.

Andrew Mitchell MP is a former international development secretary. His new report, 'A Safer and More Prosperous World: Why Aid Really Matters in an Age of Austerity’ is published today by the Legatum Institute